Acme for sale?
Goldman Sachs prepares "strategic alternatives" for owner SuperValu
Acme for sale?
Joseph N. DiStefano
UPDATE: "There's little reason to believe deals are imminent," says Jonathan Feeney, analyst at Janney Capital Markets, looking at the prospects for SuperValu's dismemberment, in a report to clients today. Of SuperValu's major brands, "Shaw’s appears to be struggling, as does Albertson’s... and Acme, as we saw on our store tours with management in February. That leaves Jewel, SVU’s leading banner in the largest geography," with unknown prospects.
EARLIER: SuperValu, the Minnesota-based grocery chain that owns Malvern-based Acme Markets, until recently the dominant Philadelphia-area supermarket chain, has hired Goldman Sachs and Greenhill to conduct a "strategic review" of "alternatives" for its operations and has suspended its dividend, the company says here. Inquirer note here. The company, which also operates Albertson's, Save-A-Lot and other chains, has been shutting stores, laying off workers and weighing further cost cuts as it tries to cope with competition from Wal-Mart and European-owned chains. "Strategic" changes can include selling or shutting subsidiary store chains.
SuperValu shares fell 30% in response, reports Bloomberg here. "The end may be near" for SuperValu and Acme, writes DAVID Goodman of Conshohocken-based Equity Retail Brokers, here.
One can only hope. Their quality has slipped considerably and the seem to be run in a way that indicates nobody is watching the store anymore. Bad meat,items well past expiration dates now line the shelves.— jimmymack- As much as I hate for good, hard-working people to lose their jobs, frankly I am not surprised. Here in NE Philly they are being squeezed by Walmart, Target, Bottom Dollar, Food Basics, and Giant.— The Baron
...where's the union bashing?...how dare people expext to support a family working in a supermarket...how DARE they!...people need to get at least 8 years of college so that they can come out with absolutely no sense whatsoever and work in some office somewhere staring at a screen all day...- Let's be real - if you think you can support a family with a grocery store job, you are wrong. Maybe 15-20-25 years ago you could but not today. It's time people started realizing that the world is a lot different and you can't just have things the way you want them. "I need to be paid a living wage" - jobs pay what they are worth. If you can't pay the bills with the job you have, find another one that does. If you cannot, maybe the issue is YOU! What do you bring to a potential employer that will make them want to hire you, pay you and promote you??? Hmm?— squat9
- More WHOLE FOODS please!!! the rest is a schmorgesbourg of processed foods! no thanks!— tulipwalk
- i THINK THE" FAT LADY" IS GETTING HER VOCAL CORDS WARMED UP.Its sad to see a philadelphia institution wind down, but the writing is on the wall.Time marches on, and unfortunately ACME IS NEARING THE END
OF WHAT HAS BEEN A GREAT RUN!!
— flyers11 - Acme, with its stellar real estate holdings and premier locations, needs an infusion of big capital so it can out-compete the upstarts. Someone with vision needs to be brought in to see what is so obvious. Acme is suffering death by a million goldfish bites. Enough already! Fight back! Team up. Put in a 5-7 year stategic plan to win back market share and grow through improved quality and service. Incent the management. It's just too easy for the newcomers. If they're going to kill off Acme, Acme needs to take a few of them down with them. I think Acme can do even better, but it's going to take a strong strategic team with guts. Where are the leaders? Who knows the food buying demand in Philly's neighborhoods better than Acme? Team up with Wawa. Do it!— Scoop
- Their costs are too high - their locations are often in dilapidated strip malls in lower middle class areas - they are burdened with legacy costs - they have an unskilled unionized workforce making $15 an hour plus benefits slowly placing 14 ounce cans on shelves. They have union work rules that inhibit their every move.
There is no money available to improve quality or service. They are struggling against lower cost providers (Walmart and Target, who both uunderwrite the cost of their foods by selling everything else udner the sun) and outmatched by "Whole Foods" purveryors on the top end.
Only a matter of time before they go under. Any one who would buy them would only do so for the cherry locations - the rest will be closed and sold to Thrift stores and Dollar stores employing $9 an hour labor - with no benefits - which is exactly what these jobs are worth.— PhillyDanny - Maybe Unity-Frankford will pick them up?— Wilhelm Von Humboldt
- When I think of what supermarket shopping should be, I do not think of Wal-Mart. If Whole Foods = Top End, are they low cost? Probably not. Whole Foods is pricey. Wawa is pricey. Legacy costs are a drain, but they can be financially engineered down. Visionaries have to consider the cost of operating to society. Whole Foods, et al, are not in neighborhoods. The carbon footprint they make is enormous. Acme is right next door. You can walk to an Acme if you live in the city. Millions of urban middle class and lower middle class residents still have to eat. If workers are unproductive, union or not, then they must be made to be productive. If productive workers are worth more, then the microeconomic model must enable those workers. If the right, bright people were put in place at Acme, it would be a game-changer such that I wouldn't then want to be an investor in Whole Foods, Giant, Wegman's, Weis Markets, etc. Acme needs to capitalize on its tremendous geographical advantage.— Scoop
